Australians need better protection from a rapid rise in online scams that cost hundreds of millions of dollars a year, the consumer watchdog says, recommending laws that would require digital platforms such as Google and Facebook to reduce the risk of scams or face tough penalties.
The Australian Competition and Consumer Commission wants “significant penalties” attached to breaches of a new code, saying digital platforms have a crucial role in preventing scams.
The ACCC wants new laws with significant penalties to protect Australians against social media scams and fake reviews.Credit:iStock
ACCC chair Gina Cass-Gottlieb said digital platforms were in a “unique position” to stop or identify scams and to remove harmful apps as the number of scams balloons.
She said the digital platforms “need to do more to stop their users from being scammed”.
The number of losses to social media, mobile app and internet scams reported to Scamwatch doubled from 2020 to 2021 to more than $144 million. The ACCC believes real losses are “substantially higher”, estimating only 13 per cent of victims report to Scamwatch.
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Giving evidence at Senate estimates on Thursday, Cass-Gottlieb said that when including losses reported to police or banks, Australians were losing more than $2 billion a year.
On Friday, the consumer watchdog released its fourth report in the digital platform services inquiry, recommending new laws to deal with reporting and responding to scams, fake reviews and harmful apps. The laws would also aim to reduce the risk of scams, and establish a new digital platform ombuds scheme.
“Our analysis has identified concerning consumer and competition harms across a range of digital platform services that are widespread, entrenched and systemic,” Cass-Gottlieb said on Friday.
